The ban is expected to affect approximately 20 million people registered as Bolsa Família beneficiaries and will go through a legal assessment before being implemented by ordinance. Last year, the Central Bank identified that 5 million Bolsa Família beneficiaries sent R$3 billion through Pix to gambling platforms in just one month. The information prompted the Lula (PT) government to change the rules governing access to gambling, which was legalised under the Temer government and regulated by the current administration.

The Supreme Court ordered the government to adopt measures to prohibit the use of welfare programme funds for online gambling. Initially, the ministry planned to comply with the decision by banning Bolsa Família money and means of payment directly related to the benefit, such as the programme's card, from the sites. However, the technicians concluded that this was unfeasible and the decision is now to prohibit beneficiaries, individually by CPF, from placing bets, regardless of the origin of the funds.

Since last year, the government has dismantled 11,007 illegally operating gambling sites, according to the ministry. It has also opened 177 investigations into the conduct of digital influencers who illegally advertised gambling on social media, promoted illegal companies or engaged in unauthorised advertising, such as to children and adolescents. Today, 71 companies are authorised to operate in Brazil, totalling 153 legalised sites.

The secretary positioned himself against the project to ban gambling advertising on television and the internet, a proposal presented by the leader of the government in Congress, Randolfe Rodrigues (PT-AP), and which received the favourable opinion of the rapporteur, Damares Alves (Republicans-DF).

In October, President Lula declared that he would put an end to electronic gambling if the regulation did not solve gambling-related problems. The government's concerns revolved around use by children and adolescents, beneficiaries of social programmes, damage to health, money laundering and other crimes.

According to Regis Dudena, Secretary of the Ministry of Finance, they have been able to resolve the problems and the worst case scenario would be a return to illegality. The following are the main excerpts from the interview with local media:

What measures will be taken in relation to the use of Bolsa Família for sports betting?

The decision gives us a degree of uncertainty as to what exactly the Supreme Court wants us to do. One issue is that it says something about resources, not people. Another difficulty is that the decision talks about Bolsa Família, BPC (paid to elderly and disabled people on low incomes) and the like without saying what it means. We are preparing a measure to comply with the decision in the way we think possible, which is to fence off the beneficiaries, namely Bolsa Família and BPC. But this is still in the final phase of alignment, especially legal, to see if it complies with the STF decision.

Will the measure consist of banning beneficiaries from the BPC, regardless of whether or not they use money from the programme? Is it more effective?

Yes. Blocking the card would not be effective. Nowadays, it is very rare for a beneficiary to receive exclusively on the Bolsa Família card. The norm is that they are paid into an account and that this account has a linked card. The stand-alone Bolsa Família card, which is not linked to a payment or deposit account, is already prohibited in our regulations. The Supreme Court orders us to make this restriction and we are going to look for the best way to comply with the Supreme Court's decision.

With the regulated market in place since January, is there an official picture of how many people play each day and how much money they win?

We are working on this data. We expect our system, Sigap (Betting Management System), to receive daily reports from all companies via API (interface for communication between systems via requests). The bookmaker's own system will communicate daily with Sigap and tell us how many bettors have registered, how much has been wagered, how much has been won and how much has been lost. We had some technical difficulties in the first few months. We are finalising the resolution of these technical problems. Our expectation is that, by the end of the first quarter, we will be able to consolidate. The idea is to publish a report with these figures to present the first results to society.

Are the current regulations sufficient to shield the market and solve problems such as addiction, exposure of children and adolescents and crimes such as money laundering?

All regulation, by its nature, is a cycle, it always needs to be monitored, the results evaluated and, ultimately, improvements are always welcome. The regulatory choices we have made provide a much higher level of safety. The shielding is perhaps too much. But, for example, within the regulated market, our degree of accuracy in banning children and adolescents from the gambling environment is close to 100%.

President Lula said in October: ‘If regulation fails, I will end it’. Has regulation worked or should online gambling be done away with?

The absence of regulation is the worst thing that can happen. If you want to protect people and the popular economy, you need to have a very controlled and highly regulated sector to say: ‘You want to gamble? This is the way it is. If I thought I couldn't handle it, I would go up to the fifth floor (where the economy minister, Fernando Haddad, is) and say: ‘Boss, we can't’. In September the news started (about Bolsa Família) and the main ordinances had been published from February to July. I am fully convinced that regulation is a cycle and we will always have to evaluate improvements, but we have taken very important steps and the sector is much safer than it was before and than it would have been if it had been illegal.

You claim that the main health problems are related to illegal websites. How can this be proven?

I am not passing the buck to the licensed companies, but, as a rule, they are illegal sites, they are fraudulent, they are masquerading as bookmakers. You go in and you think you are betting, when in fact you are just throwing money away. We have a scenario of two months and 20 days of authorised sites. So they were sites before the regulation of the sector.

What does the total number of companies authorised today say about the national market in this sector?

We have these 71 companies, which I think is a reasonable number. From our point of view, there is a trend towards consolidation. Taking into account the brands that can be exploited, I imagine that there is a trend towards consolidation. Whether there really will be consolidation or not, time will tell. But I see a trend towards buy-outs, mergers and acquisitions. If there are two companies, each exploiting a brand, without very significant results, they will eventually merge into one company.

The leader of the government in Congress, Randolfe Rodrigues, presented a project to ban gambling advertising. The rapporteur, Damares Alves, gave a favourable opinion. What is the ministry's position?

Advertising currently has a social function: to bring gamblers to authorised sites. Children and adolescents cannot participate, they cannot be the target of advertising. Gambling is a way to lose money for entertainment. So you can't say that you are going to get rich. Later on, if we have problems with advertising - for example, too much gambling, something like that - then I think we can start thinking about restrictions.

When a company with strong suspicions of being linked to gambling is authorised to operate, as it happened, how should society look at it? Has there really been a rigorous process of analysis?

What do we have to do? Look at who the company is, who the partners are and what that partner has shown me about the origin of the funds. And we have to deal with this legalisation process in a legally coherent way. If I were to hear that the funds are actually coming from a crime, what do we do? We reject it. If I have not been able to prove that the resources of those partners, of that company, are related to organised crime, I cannot reject it. In the cases where we were able to do so, with the help of the Federal Police, for example, we dismissed them. Unfortunately, in some of these cases, the courts have ordered us to authorise these companies to operate.

Have any inspection or sanction procedures been opened for non-compliance with the requirements by any of the companies?

We are carrying out specific control processes, by subject. At the moment we are doing so in relation to one prohibition of the law, that of offering an entry bonus (when the betting company offers an amount of money or a gift for the person to register for the first time). We are looking at all of them to see if there are any. We have identified those that try to do this using different methods, which is not such an easy bonus to identify.

And is this monitoring of sign-on bonuses the first one?

No, we have already done a previous one, which is with influencers. We have already notified some influencers who were advertising content in an inappropriate way, as well as advertising for illegals. There is a ban on any kind of advertising by unauthorised companies. Some influencers have already been inspected, we are in the process of responding to this and will be able to apply sanctions and fines. We link the responsibility of the influencer to the person who hires them. If they are authorised, the company that hired them will also be liable. If they are an illegal agent, we look for ways to shut them down.

Are these inspections and controls carried out by secretariat staff? How many people are responsible for digitisation?

Some of what we do today is done directly by people, and some of it is starting to be introduced into the systems. The idea is to increase the number of systems so that people do the specifics. The more systems that generate the alert and only deal with it, the better. The SPA team I imagine is about 20 people in total, and they are also responsible for commercial promotion and the lottery area in general.

By Daniel Weterman e Vinícius Valfré